The Microsoft Dynamics practice is one of four technology practices at LIDD and one of two that implements an Enterprise Resource Planning (ERP) software. ERPs integrate the management of a business’s core activities in a single software system. In an ERP, business leaders and functional experts can manage everything from finance to manufacturing to sales, enabling smooth, streamlined operations and real-time insight. LIDD’s Dynamics team implements several of Microsoft Dynamics products, the most notable being a cloud-based ERP for mid-sized enterprises called “Business Central.” Across the firm, LIDD’s expertise is concentrated in the consumer products, e-commerce, retail & manufacturing industries.
A recent client I’ve worked with is an exciting company specializing in organics recycling and compost production based in the United States. This client’s one-of-a-kind processes turned out to be an entirely new (and exciting!) endeavour for our team to take on.
One of the biggest challenges with this Business Central implementation project was evaluating the cost of operations: since composting is a mostly idle process that involves letting organic matter rest for weeks at a time, how do we determine the cost of production? Although Business Central accounts for ‘wait times’ in a production process, the software’s standard features do not allow for a cost to be associated with these production stages. Another challenge was determining the yield of the compost production runs. With environmental factors such as temperature, humidity, and moisture affecting the bulk density of both the inputs and the outputs, how could we capture the actual amount of organic matter consumed and compost created? Finally, the composting process produces a by-product called ‘overs’ – particles in the final batch of compost that were too big to be sold and had to be broken down further. These overs could be used as inputs again, so we had to develop a systematic solution to track them as inventory items.
At the beginning of an ERP implementation project, we learn about the client’s business in a process called, “requirements gathering.” After completing this project stage with the compost client, our team knew we would have to set up a production order for the composting process. A production order is like a recipe. However, since there is no rigid ‘recipe’ for compost and the inputs and outputs are so variable, we took an atypical route. To account for the production of ‘overs’ as a by-product, we configured the system to consume material at both the beginning and the end of the recipe. In the first step, we consumed the raw materials, such as food waste, yard waste, and overs. In the last step, we consumed a negative quantity of overs. This was effectively the same as “producing” overs and increased their quantity in Business Central’s inventory system once the production order was complete. To account for the variable ‘wait times’, we looked at historical data to determine an average unit cost for each step of the routing. This allowed us to address the variable rest times and still have near-accurate cost calculations. Finally, to account for large discrepancies, we allowed values to be manually updated when necessary. This reduced the amount of manual recordkeeping required, but still gave the client flexibility to intervene as needed.
This project challenged our conventions and made us think outside the box. In doing so, it enabled us to cater to a completely different business model, helping the Dynamics practice develop our expertise in non-traditional manufacturing processes and green enterprises.
By Sneha Singh - Solutions Analyst in Technology Practice